Lessons From Argentina's Collapse

I was recently sent a link to this 4 part article describing a first hand account of the Argentine collapse of 2001. For those that are interested in what the streets might look like, this provides some thoughts worth pondering:

-The author seems to vibe well with Chris: Neither cities nor secluded rural areas were safe. Small communities with people who could trust each other were the way to go.

-Grey and black markets for gold were largely driven by jewelry scraps. As such, ALL gold at these markets was treated as if it was 14 kt. Thus, cheap rings and jewelry were a good form of precious metals to have around and were often valued the same as 22 or 24 kt gold.

Some very interesting things he advises there. Gold jewllery, still useful even if TSHTF. A bag of gold rings is a lot of money for me so thats near the bottom of the list. Top of the list are the luquid fuel camping stove and the led head lamp. A bullet proof vest, hmm. The kind that can fit under regular clothing. Where in canada could you get something like that?

" I know a guy that
had one of those big chrome-tube bumpers installed on his truck,
especially for hitting those that were stupid enough to try and make
him stop by standing in front of the car."

"Owning a
shop-business is hard. You have to consider armed robbery (some get hit
10 times a month) and still you have to pay the police for protection
(from themselves)"

"The cops are involved in most illegal activities like drugs, prostitution, robbery and kidnaps."

The points you want to look for your storage food are, in order of importance:

1) No need of fridge.
2) High nutritious value/volume
3) Long shelf live, between 1-5 years.
4) That they don't need water
5) That they don't need cooking

I dont see the crime here being as bad as what he descibes since the argentina disaster was caused by a crimanal enterprise but at least when tshtf here the law enforcement and polititians will be mostly honest folks. Thanks a lot mike for that it really helps.

True it is more likely that the police etc will stay honest folks. But never never assume anything in desperate times. Desperate times call for desperate measures, by everyone. The possibility is there that corruption will run rife.

I should be direct and defer any credit to Cat233, who showed me this article in the first place.

Another thing I found interesting was the concept of speeding straight towards people that jump in the street. I was traveling in Europe last year and spent a night in a hostel wtih a South African bank manager. The man told me that where he is from, there are many gun restrictions, but the results have just empowered criminals. Further, he told me that it is common place for theives to be so bold as to lay down on the street blocking a car's path. When the car stops, it is ambushed by an armed gang. Generally, the driver does not survive, regardless of how compliant they are. Another tactic used by thieves is to throw police style tire "shredders" in the street that puncture tires and disable the vehicle. Usually this ends very poorly for the driver.

During my counter terror days, we produced executive protection videos. We taught drivers to run over women wheeling a stroller who pulled out in front of them.

It's a rough world sometimes. Our extensive data showed that being kidnapped, even domestically, often led to death. Better to risk death trying to avoid capture.Even if you survive, the trauma is extensive.

That is really interesting. Well horrific is a better description. Humans can be such ghastly creatures. Sometimes I am so ashamed to be one. But I appreciate the information, as I have had such a sheltered, innocent life that I would be a prime target through sheer naivety.

Britinbe, Me too! The article has given me a kick up the bum to get more organised than anything else has.

Yep -- I caught this article a few weeks ago (forget where). It's really impressed upon me the idea that post-SHTF the less you have to leave your domicile/home base the better, and when you do, assume the worst at all times. Go armed, go quickly, and maintain situational awareness without fail. (Didn't even know what that was until I read about it...)

The thought of such a world skeeves me out, but it's better to be ready and not need it than to need it and not be ready.

Like many of you I've read that the rural areas were best since they are more isolated and have the potential to raise more food. Then I have read that it's important to reside close to public transportation. I think this article offers an alternative view that makes more sense in many ways.

First, I think that groups of people may prosper better than individuals. I live in a community atop a large hill outside of Pittsburgh. I know my neighbors and can visualize how we would probably work together to secure our ground and to help one another with transportation issues. I don't think I would be better off out in some remote location - or in a city with a heavy population density.

Thanks for an excellent article. As one who's personally been through a short term civil unrest situation, this article brought back old memories and feelings that were distinctly unpleasant, to say the least. The advice is very sound from my perspective.

Mike, great link but I think your comment below is unintentionally incorrect based on the original article. Maybe I'm reading what you posted wrong but 'cheap rings & jewelry' were not valued at 22-24 kt but instead always at 14kt. I think the risk is paying a premium for 24kt jewelry but you'll only be given credit for 14kt. Just to be aware.

Mike Pilat wrote:

I-Grey and black markets for gold were largely driven by jewelry scraps. As such, ALL gold at these markets was treated as if it was 14 kt. Thus, cheap rings and jewelry were a good form of precious metals to have around and were often valued the same as 22 or 24 kt gold.

Cheers,

Mike

The origninal article

"Since it is impossible to determine the true mineral percentage of gold, small shops and dealers will pay for it as regular jewelry gold.

What I would do if I were you: Besides gold coins, buy a lot of small gold rings and other jewelry. They should be less expensive than gold coins, and if the SHTF bad, you'll not be losing money, selling premium quality gold coins for the price of junk gold. If I could travel back in time, I'd buy a small bag worth of gold rings.

I think the author hit it well in saying about planning for what you think the scale of the SHTF will be. \ie. if you think paper money will no longer be used then cheap gold is your best option for barter & exchange while quality gold coins are better used as a store of wealth to be 'cashed back in' once the dust settles.

My opinion is that..don;t use gold coins as a your 'best' store of wealth if you think you will be bartering with them.

I knew a little about the situation in Argentina the past decade or so, but this kind of account shows it to be ten times worse than I previously was aware of. My fiancee and her family experienced a similar financial collapse in Mongolia during the 90's, and it's interesting to note the similarities and differences between her experience and this account from Argentina. I'll try to give a brief account as she related it to me and attempt to do it justice...

Mongolia had a Soviet-style Communist system for several decades and relied heavily on the Soviet Union for financial support and imports of manufactured goods and oil. But after the USSR collapsed and Soviet support dried up, the Mongolian economy soon effectively collapsed. When it came the financial collapse was pretty sudden, and unfortunately the day it started her family was at home all day and didn't find out until the next day, where they discovered their modest cash savings was now effectively worth barely more than half of what it was a couple days before. They immediately bought anything and everything that was available (which wasn't much) with their savings all in that same day. Store shelves were stripped bare in a matter of days, and shortages and rationing of food were put into place. The black market soon became a major force in everyone's lives, with everything in demand but especially food and vodka (I found it pretty amusing that vodka was considered an integral part of each family's ration). Power blackouts were very frequent. Having a woodstove was a valuable resource, and was extremely helpful as the normal methods of cooking and heating were unreliable. Crime had become pretty bad, though from what she related it sounds as though it was modest in comparison to Argentina, particularly with violent crime.

By her and her family's account, it was a very hard time.... but as far as I can tell their situation was overall better off than Argentina (at least as told by that author). I can't help but think about Dmitri Orlov's articles about the Soviet collapse and how in some ways they were in a better situation to cope and adapt than some Western nations like the US, and how that relates to my fiancee's experience in her country that had a Soviet-style infrastructure. Like in Russia not many people had cars or needed them to get where they needed to go, they were already used to coping with certain hardships and shortages of various goods, and the state had many years experience in exercising direct control of many aspects of production and distribution. This is not to say the Communist system is a better system, but just that in this particular kind of crisis those things perhaps helped keep their society from deteriorating to the degree that Argentina suffered.

Sadly, I think if we suffered a total economic collapse here in the US we are likely to end up more like Argentina and less like the former Communist Bloc countries. We'll probably have a semi-functioning government and there won't be a complete collapse of law and order, but for the most part we'll all be on our own to provide for and protect ourselves. Anyway I just thought some people here might find my fiancee's account helpful in some way. Sometime I'll see if I can convince her to write a more detailed and informational account of her family's experience through her country's crisis....

Mike, thanks for the article! Amanda, thanks for the strong positive review; I went and printed the article out as soon as I read that!! This is the kind of useful insight and (this-is-your-potential-future) reality-check that makes me step-up my preparations!

In a chapter "Of Human Bondage" in The Ascent of Money, Prof. Ferguson chronicles several of Argentina's collapses. "The economic history of Argentina in the twentieth century is an object lesson that all the resources in the world can be set at naught by financial mismanagement." (Ferguson, 109) The next six pages detail this story of financial ruin with names, dates, and figures.

I was chilled by Ferguson's last words on the subject: "So successful did Argentina's default prove (economic growth. . .surged while bond spreads are back in the 300-500 points basis range) that many economists were left to ponder why any sovereign debtor ever honours its commitments to foreign bondholders." (Ferguson, 115) Of course the USA is "honouring" the foreign bondholders of Citi, AIG, etc.

I started watching the series and it looks spectacular! It's a great source of insight into understanding what things looked like.

It seems that the series of this documentary is a feature length and I also noticed that google video has a feature length video about the economic recovery process. It will likely take me a little time to get through all of this, but I will be back when I do.

To those who haven't checked out the videos yet, I highly recommend them.

I hate to make my first post a negative one but I found this story to be a bit unbelievable. Not that terrible things were occurring but this writer had a very inconsistent writing style and went into details that make me believe that it was not written by a native Spanish speaker. His description of growing up in the US, but could not remember where, his description of his hand-to-hand combat, etc. leaves me very skeptical as to the authenticity of his account.

That being said, there was great information here that I believe will be very useful in a difficult situation and I plan on following many of the suggestions offered here.

As I mentioned, I followed these posts in "real time" back when this was happening. FerFAL was educated and spent some years in the states before moving back to Argentina. His account is a little sensational by some accounts (I actually have some friends in BA, and my mom went there last year) and it's not a tragic, nightmarish wreck in the "well to do" areas - however, there are some very serious corruption and socio-economic problems lingering even now.

I only broached the subject with my friend one time, and she blew it off - I took that to mean that things had been bad, and were not something she was interested in talking about.

Either way, his account is very sharp - I think it should be reviewed and discussed.
There are some elements that I disagree with, and some things that left me thinking "Hey, what happened to...?"

Also keep in mind that Argentina was kept "afloat" by international interests. If America were to collapse, there wouldn't really be anyone capable of catching the falling giant.

Similar videos about the collapse and recovery can be found by going to Google, clicking on "video" at the top and then searching for 'Argentina's economic collapse.' Youtube will yield similar results.